On 11th April 2016, the House of Lords debated the Government’s Housing and Planning Bill at its Report stage. Lord Best and Lord Beecham tabled amendments to increase the period for which Starter Homes had to be sold at a discount. The Bishop of Coventry, the Rt Revd Christopher Cocksworth, spoke in support of these amendments, and Baroness Williams of Trafford responded on behalf of the government. In a subsequent vote, amendment 1 was passed by 275 votes to 181.

Lord Bishop of Coventry: My Lords, I apologise for not engaging with the Bill at an earlier stage. Other colleagues from this Bench who have engaged with it are unable to be here today. I declare an interest: I have five children, and I worry very much about how they will own their own properties. Two have already managed to; the other three will need to work on it. It will be a little bit difficult for them. They will not have a great deal from me to help them, as they come from a clergy family. That is my second declaration of interest. Living on a clergy stipend for most of my adult life and living in clergy accommodation means that I have got to know the letting world reasonably well as a way of trying to make provision for my future and my family’s future when I am evicted from my house at some point.I very much commend the Government for the whole initiative of trying to help people on to the housing market. As a parent, I appreciate that enormously. A good deal of me is attracted to this proposal. I can see it being very helpful for my third son, who is just getting to that point. It could be extremely beneficial to him, but I worry about how it would leave my fourth and fifth children when they are in that position.

I simply wanted to say that there seems to be a moral principle to secure the permanent benefit of public funding in this way for as long as possible and to minimise the potential for this scheme to be used unduly for investment purposes.

Baroness Williams: I made clear in Committee that we want to ensure that starter homes are sold to those genuinely committed to living in an area and not to those who would simply wish to quickly sell to secure financial gain. However, we also want to support mobility. Many noble Lords expressed concerns about the proposed five-year restriction that would enable the owner to sell at full market value after five years of occupation. I listened carefully to the quite extensive debate in Committee and to the views of the sector. As a result, we are seeking views in our consultation on whether a tapered approach should be introduced. This would enable owners of starter homes to sell at an increasing proportion of market value over time, stepping up to 100% after a maximum of eight years. We consider that restrictions beyond eight years would unreasonably limit young people’s ability to move on.

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The amendment of the noble Lords, Lord Best and Lord Beecham, presents a much longer taper. My first concern is the limitations this would place on individuals. A couple in their mid-30s, buying a starter home as their first house, would need to stay until they were in their mid-50s to realise the full value of the property. Starter homes are about people buying their first home, not their only home.

Clause 2 provides the Secretary of State with the power to make regulations on these restrictions. The use of secondary legislation allows us to consult the sector and then bring affirmative regulations back to Parliament for agreement. Placing these restrictions in the Bill would take away our ability to engage properly and would also limit flexibility to make adjustments in the future. We will consider all responses to our consultation carefully, and I welcome noble Lords’ views to help inform the resulting regulations. We need to work with those who will make this work on the ground to test our proposals and to ensure that the restrictions are feasible, proportionate and effective. In particular, the views of lenders are important, as the noble Lord, Lord Best, said. They have confirmed today that they welcome the principle of a taper but want to continue to discuss how best to make it work in practice. They are not supportive of a 20-year taper in the Bill. Furthermore, we are working with the sector on drafting model Section 106 clauses to help local authorities and applicants with securing the post-sales restrictions. This will help to standardise the approach to securing starter homes and reduce burdens on the planning applications process. It will build the restrictions into the conveyancing process so that first-time buyers and their advisers are aware of, and have certainty on, our approach.

Finally, I wish to be clear that we have listened to noble Lords’ concerns expressed in Committee and are now consulting on a taper to seek wider views from those who will make it work on the ground without hindering mobility. I hope that the noble Lord will not divide the House but be satisfied with the commitments that I have made. I ask that the amendment be withdrawn.

Lord Best: I am grateful indeed for an economist supporting Amendment 1. The noble Lord, Lord Horam, welcomed the starter homes initiative in principle, as nearly all of us do, but felt that it could be improved. He greatly welcomed the idea of there being a payback over a period of years once people moved out and moved on. The noble Baroness, Lady Warwick, was equally supportive and the right reverend Prelate gave the House a very practical illustration of a family with five children. Even in the most affluent of households, finding the deposit for five children to buy would be a pretty uphill struggle. Starter homes, as a way of helping people who will not be able to get hold of a deposit, will be a useful addition, but the right reverend Prelate felt that securing the public benefit for as long as possible—which Amendment 1 achieves—would be useful.

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The Minister hoped that I would not wish to test the opinion of the House on this. I am clearly reluctant to do so when she has been a listening Minister throughout this process. We have the assurance that secondary legislation, after further consultation, may produce regulations that take us further in the right direction, but this is only in prospect for the future. Only by putting things on the face of the Bill can we, ultimately, be sure that they will happen. So, with a slightly heavy heart, I would like to test the opinion of the House.